The Week in Mobility - 16 July 2021

This week it was announced that a world-first sugar and salt tax could be introduced in England as part of the new National Food Strategy. The tax on wholesale sugar and salt is intended to be an incentive for manufacturers of confectionery and processed food to reduce the content of the offending ingredients. In reality, to avoid sacrificing the sugary integrity of a Mars bar, it’s likely that the tax would instead manifest as higher prices for consumers.??

This is problematic as unhealthy food tends to be significantly cheaper than fresh, healthy alternatives. Boris Johnson agrees with this sentiment, stating that extra taxes should not be put on hard working people.??

In England, 1 in 3 people aged over 45 are clinically obese. The resulting food related diseases, loss of productivity and reduced life expectancy are significant burdens that the NHS and economy has to carry at a cost of approximately ￡74 billion.

Swap sugar and salt for the word emissions, confectionery for electric vehicles and NHS for environment and the paragraphs above still ring true. That is with the exception of Boris’ stance, given the government’s recent decision to slash electric car subsidies from ￡3,000 to ￡2,500. This was joined by a reduction in the price ceiling for eligible vehicles from ￡50,000 to ￡35,000, despite the ban on ICE car sales set for 2030.

Prioritising the switching of private passenger vehicles makes sense when considering the greatest volume of vehicles on the road. However, at this point in time, it is the sugar tax equivalent of raising the cost of a chicken nugget to the same price as a superfood-tofu-acai berry smoothie rather than subsidising the cost of the smoothie or, incentivising McDonald’s to focus on developing a healthy, low cost menu.

This week the UK’s Department for Transport and EU Commission announced the ‘Green Print’ and ‘Fit for 55’ respectively. The Greenprint outlines a plan to ban the sale of commercial ICE vehicles between 3.5 - 26 tonnes by 2035 and those over 26 tonnes by 2040. The roadmap is ambitious and the path forward is clear and achievable providing consumers are well supported in making the EV transition. The EU’s ‘Fit for 55’ includes a number of updates to existing energy laws as well as new legislative proposals to help meet the EU’s target of net zero by 2050. The update to the emissions standards for Cars and Vans called for average emissions of new cars to come down by 55% from 2030, and 100% from 2035 compared to 2021 levels (approx. 43g CO2 per km in 2030 to 0g CO2 per km in 2035).

In other words, there will be a ban on sales of ICE vehicles (LCV and Cars) in 2035. With this in mind, the 2030 milestone seems a little baffling. Some back of the envelope calculation would suggest that by 2030, given that the average age of LCVs? and cars is between 11.5 - 11.6 years and approximately 20% of vehicles are over 13 years old, then roughly 30% of the total vehicles on the road in 2030 will be made over the next nine years. To hit the fleet average target of 43g CO2 per km either requires 100s of millions of euros in investment in ICE technology or millions more EV sales. For VW, for example it would likely mean increasing EV output by 15 fold from 2020 or 70 fold from 2019. McKinsey estimates that around 10,000 charging points would have to be installed every week from now on and production would require the building of 20-30 gigafactories in Europe. This doesn’t even account for the major fear factor consumers will have in buying an ICE vehicle in an environment increasingly less well set up to support them. Suddenly investing in ICE technology feels akin to trying to make a deep fried battered Mars bar healthier when effort might be better spent finding an entirely new tasty and healthy alternative.?

Earlier this month VW and BMW were fined $1 billion for their role in an emissions cartel in which they illegally colluded to restrict competition in emission saving technologies. A move which in retrospect they’re probably regretting as a). It was illegal b). It’s an expensive error and c). Now reducing emissions via ICE vehicle innovation is nigh on impossible and a pretty frivolous endeavour.

The ‘fit for 55’ 2030 target feels a little like disguising a wholemeal rice cake as a Wagon Wheel. The more you interrogate the details, the more you realise it would be better to stop trying to make a Wagon Wheel have the same nutritional value as a rice cake and start discovering the joy of delicious, nutritious alternatives that, with a little help, can also be bought with pocket money.

Have a lovely weekend,

Imogen